A senior J.P. Morgan executive described the Kingdom’s IPO market development as “unbelievable,” adding that the Kingdom “is a terrific place for global investors to store cash with some very high-quality firms.”
He also stated that there is adequate money available to absorb the Saudi market issuance, citing a worldwide IPO market of roughly $450 billion.
On the side-lines of the Capital Market Forum in Riyadh on Sunday, Alex Watkins, managing director and co-head of EMEA ECM at J.P. Morgan, noted that the Kingdom’s stock market has experienced remarkable expansion in recent years, with IPO value doubling in size since 2020.
“Over the previous three years, the Saudi IPO market has grown from $5 billion in 2020 to $9.5 billion in 2021 to over $15 billion last year. “There has been incredible increase in the region in terms of activity,” Watkins said.
According to him, up to 70 firms are in negotiations with Tadawul about a future listing on the exchange.
Watkins noted that the Kingdom has been a very investable market, with attractive returns and a clear path to liquidity.
He also stated that traditionally, the size and liquidity of the Saudi market have been hurdles in comparison to other growing markets that have provided investors with several chances.
“Benefiting from both political and economic stability, Saudi Arabia is a wonderful venue for global investors to lodge cash with some very high-quality enterprises,” Watkins added.
Commenting on global markets, the J.P. Morgan executive stated that markets have been pleasantly pleased in the previous six months, with inflation and payroll statistics showing indications of recovery.
Watkins, on the other hand, warned that there may be turbulence ahead.
“I still think there’s a lot of investor nervousness out there given the uncertainty ahead. With global and regional statistics being robust, the bears have been proven wrong for the time being. Saudi Arabia is in a good situation, both absolute and relative terms.”